You may not notice it too much from the daily chart (as seen above) since it might look more like a technical move, whereby there is a rejection at the 200-day moving average (blue line). But the fundamental story is that we are seeing a big drop in Treasury yields and that has coincided with USD/JPY falling as well from a high of 137.90 last week to 133.75 currently.
For now, risk flows are arguably bringing about the latest move in the past hour as bond yields are sinking further on the day.
The most perplexing thing about the whole SVB saga so far is that when we do see risk flows come into play, it seems like major currencies are exempt from them. The dollar is still holding lower across the board with light changes seen since we started to see a bit more of a risk averse play in European morning trade.
EUR/USD is still up 0.3% to 1.0680, down a little from 1.0700, while AUD/USD is up by 1% at 0.6645 currently, down slightly from 0.6660 earlier. Funny, innit? It seems like currency traders are still largely more focused on the Fed outlook more than anything else.
